Providers fret bundled pilot

Provider advocates generally accept a proposal to bundle Medicare payments for one of the most common orthopedic procedures, but many believe the plan is being rushed while serious concerns about issues such as payment incentives and financial risks aren't being addressed.

Under a plan the Centers for Medicare & Medicaid Services announced in late August, the agency would test bundled payment and quality measurement in 75 geographic areas for an episode of care associated with hip and knee replacements. Its aim is to encourage hospitals, physicians and post-acute care providers to work together to improve the quality and coordination of care.

The American Health Care Association told federal regulators the plan was “premature” and could “lock out” some providers by leaving bundle control with hospitals. 

LeadingAge voiced similar concerns, worrying that the plan could encourage providers to select only patients with the best chance of quick, inexpensive recoveries. The American Hospital Association says that its big concern is the plan would put hospitals at risk under self-referral and anti-kickback rules.

CMS says hip and knee replacement costs vary widely geographically. More than 400,000 inpatient primary procedures were performed in Medicare in 2013.